Sometimes, when the market goes on a nice run, investors sit on their hands. This isn't always the best advice, though, as long-term investors know not to squabble too much over minor moves in a stock's price.
In real life, such an approach is easier said than done. That's where our Rising Stars program -- which is absolutely free to view -- comes into play. The Fool gives each of these analysts money to invest on the Fool's behalf, so long as all their picks are made public for the world to see.
Over the past two weeks, activity has been relatively muted, but I'll highlight the three big purchases our analysts made and offer you a special free report on three big, domestic dividend-payers that are rapidly conquering the global marketplace.
SUPERVALU (NYS: SVU)
Rising Star Jim Royal's portfolio focuses squarely on special situations. SUPERVALU, the parent company of grocery stores like Save-A-Lot, Albertsons, and Jewel-Osco, is one such opportunity.
Jim is looking past a pretty bad earnings release, and he sees a company that has new management pointing it in the direction of sustainable profitability. For starters, the company is deleveraging its debt-laden balance sheet, "reducing outstanding debt by $350 million (fiscal) year to date on its way to $525 million to $550 million in debt reduction for the year." Once that debt is paid, it leaves more revenue to sink to the all-important bottom line.
The company is also taking steps to improve its image. Jim points to an improving gross margin as evidence that "SUPERVALU is still working on its turnaround and implementing strategies that drive long-term sustainable traffic to its stores rather than coupon clippers who buy only the great deals and nothing else."
And finally, for the dividend-lover in us all, the company offers up a mouth-watering 5.2% dividend yield.
Add SUPERVALU to My Watchlist.
Mattel (NAS: MAT)
Rising Star Jason Moser and his Motley Portfolio have been soaring in the standings, now resting just a shade under leader Alyce Lomax. Clearly, Jason's on to something with his eclectic collection of companies, and this toy maker is his latest addition.
The world toy market is growing -- especially in emerging markets, but also stateside -- and Jason likes his chances with his latest choice. He picked Mattel over rival Hasbro (NAS: HAS) because Mattel "is about twice as large with better margins and a better balance sheet." Jason is also bullish about Mattel's key partnerships with kid favorite Disney (NYS: DIS) and other entertainment companies, which give the company rights to exclusively offer popular characters from the big screen.
Be warned, though; Jason doesn't see Mattel breaking through the roof anytime soon. He's taking a long-term view with this holding: "The intention is to hold this stock indefinitely, so I'm looking for a fair price to go along with the company's stellar 3.1% dividend yield that we'll pick up along the way."
Add Mattel to My Watchlist.
Google (NAS: GOOG)
Finally, new Rising Star analyst Andrew Tonner made his inaugural pick in unique fashion: via video. Andrew's decision to include this iconic technology stock boils down to three major factors.
First, he sees Google continuing to dominate its core area of search for years to come. Currently, the company has a 65% market share in search in the United States, and it is rising. "The rest of the players are fighting for the scraps from Google's table," Andrew states.
Second is Android, the operating system that Google offers to smartphone providers free of charge. Andrew is impressed by the "savvy bet" Google made with Android, which feeds mobile searches right back through Google's search engine.
Finally, Andrew thinks today's price can't be beat. With a five-year expected growth rate of 20%, a future price-to-earnings ratio of just 12, and about $137 per share in cash, there's no reason not to own some of this stock.
Add Google to My Watchlist.
Three more of our top "buys"
If you're looking for some more investing ideas that promise to do well in good times and bad, I suggest you take a look at our new special free report: "3 American Companies Set to Dominate the World." Inside, you'll get the names of three dividend-paying stocks, as well as an in-depth look at how they're expanding their influence across the globe. Get your copy of the report today, absolutely free!
At the time thisarticle was published Fool contributor Brian Stoffel owns shares of Google. You can follow him on Twitter at @TMFStoffel. The Motley Fool owns shares of SUPERVALU and Google. Motley Fool newsletter services have recommended buying shares of Google, Walt Disney, Hasbro, and Mattel, and buying calls in SUPERVALU. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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